RTX CORP (RTX) Stock Fundamental Analysis
NYSE:RTX - New York Stock Exchange, Inc. - US75513E1010 - Common Stock - Currency: USD
Taking everything into account, RTX scores 4 out of 10 in our fundamental rating. RTX was compared to 64 industry peers in the Aerospace & Defense industry. While RTX is still in line with the averages on profitability rating, there are concerns on its financial health. RTX is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
RTX had positive earnings in the past year.
RTX had a positive operating cash flow in the past year.
RTX had positive earnings in 4 of the past 5 years.
RTX had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
With a Return On Assets value of 2.93%, RTX perfoms like the industry average, outperforming 54.69% of the companies in the same industry.
With a decent Return On Equity value of 7.94%, RTX is doing good in the industry, outperforming 60.94% of the companies in the same industry.
RTX has a Return On Invested Capital (4.88%) which is in line with its industry peers.
RTX had an Average Return On Invested Capital over the past 3 years of 3.68%. This is below the industry average of 7.79%.
The last Return On Invested Capital (4.88%) for RTX is above the 3 year average (3.68%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.93% | ||
| ROE | 7.94% | ||
| ROIC | 4.88% |
ROA(3y)2.73%
ROA(5y)1.68%
ROE(3y)6.81%
ROE(5y)4.17%
ROIC(3y)3.68%
ROIC(5y)3.17%
1.3 Margins
RTX has a Profit Margin of 5.91%. This is in the better half of the industry: RTX outperforms 62.50% of its industry peers.
RTX's Profit Margin has declined in the last couple of years.
RTX has a Operating Margin of 7.97%. This is comparable to the rest of the industry: RTX outperforms 57.81% of its industry peers.
RTX's Operating Margin has declined in the last couple of years.
RTX has a Gross Margin of 19.09%. This is in the lower half of the industry: RTX underperforms 64.06% of its industry peers.
In the last couple of years the Gross Margin of RTX has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 7.97% | ||
| PM (TTM) | 5.91% | ||
| GM | 19.09% |
OM growth 3Y-2.13%
OM growth 5Y-7.15%
PM growth 3Y-0.49%
PM growth 5Y-13.5%
GM growth 3Y-0.54%
GM growth 5Y-4.24%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), RTX is destroying value.
Compared to 1 year ago, RTX has more shares outstanding
The number of shares outstanding for RTX has been increased compared to 5 years ago.
The debt/assets ratio for RTX has been reduced compared to a year ago.
2.2 Solvency
RTX has an Altman-Z score of 2.09. This is not the best score and indicates that RTX is in the grey zone with still only limited risk for bankruptcy at the moment.
RTX has a Altman-Z score of 2.09. This is in the lower half of the industry: RTX underperforms 64.06% of its industry peers.
RTX has a debt to FCF ratio of 10.52. This is a negative value and a sign of low solvency as RTX would need 10.52 years to pay back of all of its debts.
RTX has a Debt to FCF ratio of 10.52. This is comparable to the rest of the industry: RTX outperforms 57.81% of its industry peers.
RTX has a Debt/Equity ratio of 0.65. This is a neutral value indicating RTX is somewhat dependend on debt financing.
The Debt to Equity ratio of RTX (0.65) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.65 | ||
| Debt/FCF | 10.52 | ||
| Altman-Z | 2.09 |
ROIC/WACC0.52
WACC9.46%
2.3 Liquidity
RTX has a Current Ratio of 0.99. This is a bad value and indicates that RTX is not financially healthy enough and could expect problems in meeting its short term obligations.
RTX's Current ratio of 0.99 is on the low side compared to the rest of the industry. RTX is outperformed by 87.50% of its industry peers.
A Quick Ratio of 0.74 indicates that RTX may have some problems paying its short term obligations.
RTX has a worse Quick ratio (0.74) than 81.25% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.99 | ||
| Quick Ratio | 0.74 |
3. Growth
3.1 Past
RTX shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 13.66%, which is quite good.
RTX shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -7.02% yearly.
Looking at the last year, RTX shows a quite strong growth in Revenue. The Revenue has grown by 17.15% in the last year.
RTX shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 12.23% yearly.
EPS 1Y (TTM)13.66%
EPS 3Y10.36%
EPS 5Y-7.02%
EPS Q2Q%19.38%
Revenue 1Y (TTM)17.15%
Revenue growth 3Y7.83%
Revenue growth 5Y12.23%
Sales Q2Q%9.07%
3.2 Future
The Earnings Per Share is expected to grow by 7.44% on average over the next years.
Based on estimates for the next years, RTX will show a small growth in Revenue. The Revenue will grow by 4.28% on average per year.
EPS Next Y7.9%
EPS Next 2Y9.62%
EPS Next 3Y9.9%
EPS Next 5Y7.44%
Revenue Next Year5.67%
Revenue Next 2Y5.75%
Revenue Next 3Y5.8%
Revenue Next 5Y4.28%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 22.45, which indicates a rather expensive current valuation of RTX.
Compared to the rest of the industry, the Price/Earnings ratio of RTX indicates a somewhat cheap valuation: RTX is cheaper than 76.56% of the companies listed in the same industry.
RTX is valuated rather cheaply when we compare the Price/Earnings ratio to 28.29, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 20.81, RTX is valued on the expensive side.
Based on the Price/Forward Earnings ratio, RTX is valued a bit cheaper than the industry average as 79.69% of the companies are valued more expensively.
RTX is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 21.08, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.45 | ||
| Fwd PE | 20.81 |
4.2 Price Multiples
RTX's Enterprise Value to EBITDA is on the same level as the industry average.
Based on the Price/Free Cash Flow ratio, RTX is valued a bit cheaper than 68.75% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 43.86 | ||
| EV/EBITDA | 19.22 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates RTX does not grow enough to justify the current Price/Earnings ratio.
PEG (NY)2.84
PEG (5Y)N/A
EPS Next 2Y9.62%
EPS Next 3Y9.9%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.96%, RTX has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 1.39, RTX pays a better dividend. On top of this RTX pays more dividend than 90.63% of the companies listed in the same industry.
Compared to the average S&P500 Dividend Yield of 2.52, RTX is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.96% |
5.2 History
The dividend of RTX decreases each year by -3.09%.
RTX has paid a dividend for at least 10 years, which is a reliable track record.
RTX has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)-3.09%
Div Incr Years31
Div Non Decr Years34
5.3 Sustainability
RTX pays out 67.39% of its income as dividend. This is not a sustainable payout ratio.
DP67.39%
EPS Next 2Y9.62%
EPS Next 3Y9.9%
128.89
-0.36 (-0.28%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryAerospace & Defense
Earnings (Last)
Earnings (Next)
Inst Owners81.8%
Inst Owner Change0.01%
Ins Owners0.03%
Ins Owner Change0.95%
Market Cap172.08B
Analysts75.17
Price Target143.23 (11.13%)
Short Float %0.86%
Short Ratio2.31
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.96% |
Yearly Dividend2.42
Dividend Growth(5Y)-3.09%
DP67.39%
Div Incr Years31
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)8.89%
Min EPS beat(2)7.07%
Max EPS beat(2)10.7%
EPS beat(4)4
Avg EPS beat(4)8.33%
Min EPS beat(4)7.07%
Max EPS beat(4)10.7%
EPS beat(8)8
Avg EPS beat(8)6.72%
EPS beat(12)12
Avg EPS beat(12)6.24%
EPS beat(16)16
Avg EPS beat(16)6.68%
Revenue beat(2)2
Avg Revenue beat(2)2.22%
Min Revenue beat(2)0.21%
Max Revenue beat(2)4.23%
Revenue beat(4)4
Avg Revenue beat(4)2.47%
Min Revenue beat(4)0.21%
Max Revenue beat(4)4.23%
Revenue beat(8)7
Avg Revenue beat(8)1.68%
Revenue beat(12)7
Avg Revenue beat(12)0.44%
Revenue beat(16)7
Avg Revenue beat(16)-0.09%
PT rev (1m)0.64%
PT rev (3m)6.11%
EPS NQ rev (1m)-0.08%
EPS NQ rev (3m)-1.26%
EPS NY rev (1m)0.02%
EPS NY rev (3m)0.44%
Revenue NQ rev (1m)-0.18%
Revenue NQ rev (3m)-1.35%
Revenue NY rev (1m)-0.01%
Revenue NY rev (3m)-0.41%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.45 | ||
| Fwd PE | 20.81 | ||
| P/S | 2.13 | ||
| P/FCF | 43.86 | ||
| P/OCF | 24.04 | ||
| P/B | 2.86 | ||
| P/tB | N/A | ||
| EV/EBITDA | 19.22 |
EPS(TTM)5.74
EY4.45%
EPS(NY)6.19
Fwd EY4.81%
FCF(TTM)2.94
FCFY2.28%
OCF(TTM)5.36
OCFY4.16%
SpS60.47
BVpS45.06
TBVpS-19.53
PEG (NY)2.84
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.93% | ||
| ROE | 7.94% | ||
| ROCE | 5.78% | ||
| ROIC | 4.88% | ||
| ROICexc | 5.14% | ||
| ROICexgc | 27.57% | ||
| OM | 7.97% | ||
| PM (TTM) | 5.91% | ||
| GM | 19.09% | ||
| FCFM | 4.86% |
ROA(3y)2.73%
ROA(5y)1.68%
ROE(3y)6.81%
ROE(5y)4.17%
ROIC(3y)3.68%
ROIC(5y)3.17%
ROICexc(3y)3.89%
ROICexc(5y)3.36%
ROICexgc(3y)20.34%
ROICexgc(5y)17.15%
ROCE(3y)4.37%
ROCE(5y)3.76%
ROICexcg growth 3Y14.66%
ROICexcg growth 5Y12.77%
ROICexc growth 3Y9.47%
ROICexc growth 5Y0.94%
OM growth 3Y-2.13%
OM growth 5Y-7.15%
PM growth 3Y-0.49%
PM growth 5Y-13.5%
GM growth 3Y-0.54%
GM growth 5Y-4.24%
F-Score8
Asset Turnover0.5
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.65 | ||
| Debt/FCF | 10.52 | ||
| Debt/EBITDA | 3.6 | ||
| Cap/Depr | 74.15% | ||
| Cap/Sales | 4.01% | ||
| Interest Coverage | 3.32 | ||
| Cash Conversion | 66.27% | ||
| Profit Quality | 82.17% | ||
| Current Ratio | 0.99 | ||
| Quick Ratio | 0.74 | ||
| Altman-Z | 2.09 |
F-Score8
WACC9.46%
ROIC/WACC0.52
Cap/Depr(3y)72.3%
Cap/Depr(5y)63.03%
Cap/Sales(3y)4.25%
Cap/Sales(5y)3.96%
Profit Quality(3y)104.78%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)13.66%
EPS 3Y10.36%
EPS 5Y-7.02%
EPS Q2Q%19.38%
EPS Next Y7.9%
EPS Next 2Y9.62%
EPS Next 3Y9.9%
EPS Next 5Y7.44%
Revenue 1Y (TTM)17.15%
Revenue growth 3Y7.83%
Revenue growth 5Y12.23%
Sales Q2Q%9.07%
Revenue Next Year5.67%
Revenue Next 2Y5.75%
Revenue Next 3Y5.8%
Revenue Next 5Y4.28%
EBIT growth 1Y84.42%
EBIT growth 3Y5.54%
EBIT growth 5Y4.21%
EBIT Next Year41.05%
EBIT Next 3Y18.13%
EBIT Next 5Y10.91%
FCF growth 1Y-16.83%
FCF growth 3Y-6.17%
FCF growth 5Y-10.06%
OCF growth 1Y-9.18%
OCF growth 3Y0.41%
OCF growth 5Y-4.22%